Pieces of eight!

In 1565, a Spanish galleon crossed the Pacific Ocean. The galleons were the first Hispanic high-riders, topheavy and cumbersome (Fig. 1A). This voyage inaugurated 250 years of annual shipments of spices and silk collected at Manila. The goods were carried east in a scurvy-ridden nonstop crossing of 8,000 miles of open ocean to Acapulco, where they were sold for silver pieces of eight, stamped coins worth 8 reales (Fig. 2) that became accepted tokens of exchange around the world. The silver treasure carried by these galleons was mined and minted in Peru and Mexico, then called New Spain. The proceeds from the year’s sales were taken on a return voyage to Manila (Fig. 1B). On the Atlantic side of the New World, whole convoys of galleons and their accompaniment sailed regularly from the Caribbean, twice yearly, when war, pirates, wealth, and logistics would allow, to haul the glittering bounty of New Spain to the mother country. At that time, ships sailing the eastbound Pacific route embarked on the world’s most dangerous sea voyage, through unpredictable weather in unstably overloaded galleons run by crews with deficient sailing skill. The length of the voyage could vary greatly, and depended heavily on luck. Ships with skeleton crews—that is, crews that were literally skeletons because of starvation and disease— were occasionally found. Some of them never made port. Even after months of sailing, and with the destination at hand, a galleon might be attacked by predatory buccaneers waiting to board these ships and heist their treasure. On both sides of the New World, many galleons foundered on rocks or sank due to weather, poor navigation, or fights with buccaneers. The Spanish quickly salvaged much of the treasure from these ships, but enough went to the bottom to stimulate vigorous hunts for sunken treasure even today. Spain was impatient to use its Indies treasure for short-term gain. A land power in Europe, she developed neither first-rate maritime nor mercantile traditions. The Spanish silver largely flowed immediately through Spain, to repay Italian or Dutch lenders for debts recklessly accumulated in waging endless wars for European domination. For nearly three centuries, Spain, rather than building a commercial base at home or in its colonies, depended on milking the colonies for silver. Meanwhile, the Spanish treasure fleets were good for many businesses at the time: those that provided equipment and supplies to mines and built the ships to transport or pursue the treasure did very well. In the end, an exhausted, backward, and impoverished Spain gave up both its colonies and its European power. Such was the price of greed, that a hunger for immediate payoff replaced a long-term plan. A treasure that would support the society was elusive and never realized. The English, in contrast, invested in settling their colonies as sources of renewable goods and trade rather than relying on shiny booty, and that led to long-term prosperity.